Disputes litigated in federal court frequently must be decided at least in part according to state law. But the precise content of the state law at issue is not always clear. Sometimes state courts have not addressed the issue to be decided in federal court. Other times state courts have addressed the issue but have reached contradictory conclusions. Uncertainty can result from other postures as well; for example, parties might agree that a certain principle of state law applies to their case but disagree as to how that principle should be applied to the facts at hand.

How should a federal court ascertain and apply state law in these circumstances? Civil procedure mavens know that the task of the federal court is to predict how the state supreme court would decide the issue. Upon examination, however, this response answers very little. To which sources should a federal court turn in order to ascertain state law? Does legal authority outside the sources of state law constrain how the federal court understands the sources themselves? If sources of state law point in opposite directions, how should the federal court choose among them?

The federal appellate courts have proposed widely divergent instructions, and the few commentators who have addressed this ubiquitous problem have offered similarly varying visions of the principles at stake. Many courts have tried to deny the relevance of their own judgment, instead reciting, for example, that they should observe doctrinal trends in the state law, or else that they should do the opposite – treating state law as static. Other courts have sought to restrict liability. Still others think that whenever state law is unclear, they should follow the plurality approach of other jurisdictions that have addressed the issues. Several commentators have argued that federal courts’ engagement with unsettled state law is problematic for a number of reasons, including constitutional ones. Other arguments, however, might be advanced that federal courts possess superior technical competence and that they can therefore resolve confusion among state courts. Upon close examination, all of these arguments are flawed…. Read More